City Government

2010 in Review: Scandals, Budget Cuts and Top-Level Changes

(For other year end coverage, see Gotham Gazette's review of the big things that did not happen in New York in 2010, and our roundup of prominent prognosticators' predictions for 2011.

Regardless of what may confront him in 2011, Andrew Cuomo had a pretty good year in 2011. That makes him one of the few New York luminaries who did.

For most of the city and state's political players, the year now ending was marked by budget cuts, scandal and overall bad news. And with the City Time controversy breaking into the headlines and more deficits on the horizon, the coming year could bring more of the same.

Until then, though, here are Gotham Gazette's picks for the Top 10 New York stories of 2011.

Coming Up Cuomo

Eight years after his political career appeared to have ended -- and 16 years after his father lost his bid for a fourth term as governor -- Andrew Cuomo resoundingly defeated Republican Carl Paladino to win election as the state's 56th governor.

In many respects, the victory night celebration in Manhattan marked a kind of anticlimax to two and a half years of bizarre twists in the state's politics.

Cuomo's path to victory began in March 2008 when Eliot Spitzer resigned as governor in the wake of reports he frequented high-priced prostitutes. It picked up steam as Gov. David Paterson's brief honeymoon skidded to a halt when he locked horns with the legislature over efforts to cut state spending. Cuomo then got a huge boost when Paterson, weakened and enmeshed in various allegations of wrongdoing (see below), decided not to seek election.

Already blessed with high name recognition, general approval from the public for his performance as state attorney general and a formidable war chest, Cuomo's good fortune continued as the state Republican Party appeared in disarray. In September, Carl Paladino, a multimillionaire real estate developer and Tea Party sympathizer from Buffalo, thrashed the establishment GOP candidate, Rick Lazio, in the primary.

Paladino's upset win -- along with his plain speaking on the mess in Albany -- brought him a quick spike in the polls. His campaign, though, quickly foundered amid accounts of pornographic and racists emails and other bizarre behavior --including rantings about gays, a physical confrontation with a Post reporter and wandering off in search of the bathroom in the middle of the only gubernatorial debate.

For his part, Cuomo ran a tightly controlled race, offering few specifics about how he would cut the state spending by billions or other policy areas. The move paid off on Election Day, as he came away with more than 61 percent of the vote.

From Hearst to Tweed

On Nov. 9, after eight years as schools chancellor, Joel Klein announced his resignation. Talk of Klein's leaving had been wafting around for months, if not years, so the real surprise in the City Hall press conference was not that -- but rather Mayor Michael Bloomberg's choice to succeed him: Cathleen Black, the chair of Hearst magazines.

The choice startled just about everyone, and in the days and weeks to come began to appear ever more confounding. While Bloomberg praised Black -- who travels in many of the same moneyed circles as the mayor -- as a world class manager, it rapidly emerged she had no experience in public education and as far as anyone could tell, little interest in it.

With critics describing the appointment as "a slap in the face' to the city's public school parents and teachers, and an example of cronyism, efforts mounted to block Black. State education commission David Steiner -- the one person with the legal authority to stop the appointment -- appointed a panel to advise him on whether to grant Black the waiver she would need to become chancellor, given her lack of education experience. That group voted against the waiver.

Steiner -- apparently nervous at the prospect of saying no to Bloomberg -- then engineered a compromise that would require Black to name an education deputy in return for his OK. She or someone (Bloomberg? Klein? Patricia Harris?) selected educator Shael Polakow-Suransky.

Window-dressing or not, it closed the deal for Steiner who promptly gave his blessing to Black. It did little or nothing to mollify some politicians and parents. Legal efforts to block Black will be heard in an Albany court on Thursday.

And the cuts apparently did not go deep enough. Last month, Bloomberg unveiled a new round of $1.6 billion in reductions -- many of which could take effect without the council's approval. They represented the ninth round of slashes in the last three years. This time the cuts are slated to fall on libraries (as usual), the Administration for Children's Services, the fire department -- which plans to some companies shut during evening hours -- and Homeless Services. The plan also calls for teacher layoffs over the next 18 months, something averted in the spring when Bloomberg froze teacher salaries.

As the year ended, council members held hearings and denounced the cuts. Whether they could avert any remains to be seen.

But whatever happens with that, the worst could still come. In announcing the cuts last month, Deputy Mayor Stephen Goldsmith said even with the latest cuts, the city still faces a $2.4 billion shortfall for fiscal year 2012. Discussions on that begin early next year.

And the state could be in even worse shape. After a year in which the legislature and governor proved unable or unwilling to tackle the state's fiscal woes, the government faces a deficit estimated at $9 billion to $14 billion for the next fiscal year.

A Widening Net

Investigators began probing possible scandal at the New York state pension funds in 2006. But this year more people and firms fell, as Attorney General Andrew Cuomo seemed intent on wrapping up as many strands in the probe as possible before moving on to his new job.

In the "pay to play scandal," then State Comptroller Alan Hevesi and some of his associates used the state's $122 billion pension fund to reward financiers and firms that supported their campaigns, gave them money or did other favors. (Hevesi resigned in 2006 in the wake of allegations that now seem almost quaint.) In October, Hevesi pleaded guilty to having take $1 million in money and favors.

Last month, one of Hevesi's closest associates, former political consultant Hank Morris, reached a plea bargain on what has been described as a "minor charge." Morris reportedly took $19 million in fees for himself.

Altogether as of early November, six people in addition to Hevesi and Morris have pleaded guilty in connection with the probe, 16 firms have settled, and more than $139 million has been paid to the fund and the state, according to Cuomo.

Cuomo, though, has not been able to wrap up the case of Steven Rattner, the former Obama administration car czar and investment advisor to Mayor Michael Bloomberg. Rattner has agreed to pay $6.2 million to the Securities and Exchange Commission for his involvement in the kickback scheme. Cuomo has filed two lawsuits against Ratter seeking at least $26 million. The fight between the two men has turned nasty, with Cuomo describing Rattner's behavior as "the most egregious" of all the skulduggery into the pension fund case -- and calling Rattner a liar to boot.

The Really High Cost of Yankee Tickets

David Paterson, last February, shortly before announcing he would not seek election to a full term as governor

Gov. David Paterson's really, really bad year started with a storm of rumors in February that the New York Times was at work on a story about him that would prove so damaging he would have to resign. Sex? Drugs?

Whatever the paper may -- or may not -- have unearthed about Paterson's personal proclivities, on Feb. 16, what many believed to be the story came out -- and it concerned not Paterson but a close confidant: David Johnson. Johnson had been arrested on drug charges as a teenager, the article said, and for assault in the 1990s. He also had, it continued, "on three occasions been involved in altercations with women, two of which led to calls to the police." That piece, New York magazine commented, met with "widespread media disappointment."

But eight days later, the paper published the bombshell. It reported that Paterson and members of the state police persuaded Johnson's former girlfriend to abandon her efforts to seek an order of protection against Johnson, who she charged, assaulted her in her apartment on Halloween night.

Two days later, with Attorney General (and potential political rival) Andrew Cuomo looking into the case -- at Paterson's request -- Paterson announced he would not seek re-election in November.

Months later, former Chief Judith Kaye, assigned by Cuomo to conduct the probe, determined Paterson made errors of judgment in the matter but did not break the law.

The governor did not fare as well in another case that came under Kaye's scrutiny: his alleged acceptance of free World Series tickets. Kaye found Paterson might have committed perjury when he told state investigators he had always planned to pay for the tickets to the opening game of the 2009 series. Earlier this week, the state ethics commission fined Paterson $62,125 for soliciting and taking the tickets -- a hefty premium for tickets that, had he gotten them the normal way, would have set him back $2,125. Meanwhile Albany District Attorney David Soares reportedly is continuing to investigate the possible perjury charges.

As for Johnson, he was arraigned on misdemeanor assault charges in August. Last month, Paterson officially fired Johnson, who had been suspended without pay since February.

Grade Deflation

New York City's vaunted leap in student achievement under Mayor Michael Bloomberg took a major hit this summer as the state Department of Education changed its scale for grading the tests. Responding to widespread criticism that scores had risen because tests had gotten dumber -- not that students had gotten smarter -- in the last several years, the state raised the score a student must reach to be considered "proficient" in English language arts and math.

The new scoring had only 54 percent of students in grades three through eight last school year meeting the standard for math -- down from 82 percent the previous year -- and 42.4 percent in language arts down from 69 percent the previous year.

The new system also found that, instead of narrowing as Bloomberg and his school chancellor Joel Klein had long proclaimed, the achievement gap between races had widened. Many blacks and Latinos had, apparently, scored at the lower end of the proficient category and so were knocked out of the category when the state raised its bar.

Despite the new scores, Bloomberg stood by his program. "There is a lot of evidence we are making great progress," he said. "Everybody basically knows this is working."

Power Loss

On Dec. 2 the House of Representative voted to censure Rep. Charles Rangel, for years the most powerful member of New York's House delegation. Although Rangel faces no criminal charges, the 333 to 79 vote delivered a harsh and very rare rebuke to the Harlem congressman, who had briefly served as chair of the powerful House Ways and Means Committee.

Rangel stood accused of failing to pay taxes on a vacation home in the Dominican Republic, of filing misleading financial disclosure forms and of improperly soliciting donations from corporations with business before his committee for a center named in his honor at City University of New York.

Following the censure, Rangel saidhe made mistakes but "there was no deception involved."

Although Rangel was already facing ethics charges during last fall's campaign, he handily turned back challengers in both the primary and the general election. He has saidhe plans to serve out his current term but many suspect it will be his last.

If You See Something...

Police evacuated Times Square as they investigated and disarmed what turned out to be a car bomb.

Acting on a tip from a street vendor, police on May 1 disarmed a crude -- and smoking car bomb -- in the heart of Times Square on a Saturday night. Although the device, made of propane, gasoline and fireworks packed in a Nissan Pathfinder -- appeared crude, Mayor Michael Bloomberg said it still could have killed people and created havoc. "We were very lucky," he said.

The threat prompted the evacuation of thousands of tourists and other in the busy area, left people shut out of their hotels and forced cancellation of some Broadway shows.

Two days later, police arrested Faisal Shahzad, a naturalized U.S. citizen from Pakistan, for placing the bomb. In June, he pleaded guilty, telling the court that the U.S. should withdraw its troops from Afghanistan and Iraq and end its drone raids there or face further attacks. In October, a judge sentenced him to life in prison.

While many aspects of Shahzad's plan appeared amateurish, evidence emerged in subsequent days that the Pakistani Taliban may have played a role in the aborted attack and that Shazad had had bomb training in Pakistan.

Crime Capital

Continuing in the footsteps of former Majority Senate Majority Leader Joseph Bruno and former State Assemblymember Brian McLaughlin, members of the state legislature continued their record of wrongdoing in 2010.

Leading the rogues gallery was Pedro Espada, until very recently State Senate majority leader and New York's highest ranking Latino politician. Last week, Espada and his son were indicted for allegedly siphoning more than half a million dollars from a group of health clinics they run -- and using it to pay for home improvements, a serious sushi habit and other expenses. Espada, who denies any wrongdoing, also faces a civil lawsuit charging he stole many millions more from those clinics, which are supposed to care for poor people in the Bronx.

In February, the Senate removed one of the miscreants in its midst -- Hiram Monserrate -- following his 2009 conviction on misdemeanor charges arising from a dispute with his girlfriend. (Monserrate won acquittal on far more serious charges involving slashing the woman with a broken glass.) In expelling Monserrate -- the first senator to suffer that fate in almost century -- the senators said they were taking a strong stand against domestic violence. His supporters, though, said he was being singled out for bucking the party leadership, and some charged he was the victim of anti-Latino prejudice.

Out of politics, Monserrate, though, is not out of trouble. In October, he was indicted on charges of fraud and conspiracy dating back to his days as a member of City Council. The charges allege that Monserrate steered some of his member items money to a nonprofit he controlled and used the funds to help finance a run for the State Senate. (The indictment is part of the ongoing federal investigation in abuses involving member items

Other legislators in trouble in 2010:

--Former Queens State Assemblymember Anthony Seminerio was sentenced to six years in prison in February after pleading guilty to charges that he improperly solicited money from people and organizations who had business with the state.

--Earlier this month, State Sen. Kevin Parker of Brooklyn was convicted of misdemeanor charges arising from his attack on a New York Post photographer. Parker, who has been in trouble for fighting with people before, won acquittal on felony charges in the assault, but could still face expulsion from the Senate.

--And just in case you thought only legislators from New York City got in hot water, earlier this month, former State Sen. Vincent Leibell pleaded guilty to federal obstruction of justice and tax evasion charges. He had been slated to become Putnam County executive next month -- but now could end up going to jail instead.

Flip Flop

After just two years in Democratic hands, the State Senate will return to Republican control when the new legislature takes office next month. Although a number of seats shifted, the decisive move for the GOP came in a ruling by a state Supreme Court judge that declared Jack Martins the winner over incumbent State Sen. Craig Johnson ion a Long Island district. The state's highest court upheld the decision this week.

Democrats had had a razor thin 32-30 vote edge, and the Republican margin will be just as small. Whether that will mean another two years of turmoil and gridlock in the upper chamber remains to be seen. Of course, the new majority leader, Dean Skelos, tried to turn back such fears. "We're prepared to work with the governor-elect and all of the members of the State Legislature to do the people's business, and look forward to a productive 2011 legislative session," he said.

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